Bitfarms, a Bitcoin mining company based in Toronto, has adopted a shareholder rights plan to counter Riot Platforms’ takeover attempts. On June 10, Bitfarms’ board unanimously approved this plan to protect its strategic review process from Riot’s actions.
The “poison pill” strategy aims to prevent hostile takeovers and safeguard shareholder interests. Riot Platforms, holding 11.62% of Bitfarms’ shares, proposed acquiring all shares for $950 million and called for a special shareholder meeting to bypass the review process.
Bitfarms’ special committee found Riot’s offer undervalued the company and noted Riot’s refusal to join the strategic review. Riot has since acquired an additional 8.01% of Bitfarms’ shares, undermining the review process.
The Rights Plan activates if any party acquires 15% or more of shares before September 10, or 20% thereafter, without compliance. Shareholder ratification and Toronto Stock Exchange approval are required within six months, potentially delaying final acceptance.
This move underscores Bitfarms’ commitment to maintaining control over its strategic direction and protecting long-term shareholder value.
